1. Home Care Industry Webinar 2011-12 Budget Actions
New York State Department of Health
Home Care Associations
June 23, 2011

2. Other Home Care Questions
Agenda
CHHA and Other Home Care Reimbursement Reforms
Health Homes
Other Budget Actions
To facilitate today’s discussion and assist the Department in efficiently addressing inquiries about today’s Webinar, please direct all questions and comments to:
Please indicate one of the following in the Subject line of your
Reimbursement Issues
Health Homes
Other Home Care Questions

3. Home Care Reimbursement Reforms

4. CHHA Reimbursement Reforms
MRT #5 ~ 2 Phases of Reimbursement Reform
Aggregate Annual Per Patient Spending Limits
Effective April 1, 2011 through March 31, 2012
Episodic Pricing and MLTC
Effective April 1, 2012
Both phases inform reimbursement with a patient acuity tool and a wage index adjustment ~ Developed in consultation with Home Care Work Group

5. CHHA Spending Limits ~ Overview
April 11, 2011 Dear Administrator Letter
Provider specific, aggregate annual per patient spending limits are calculated using 2009 Medicaid claims, and are a weighted blend of:
A provider’s average per-patient claims (51.44% weight)
Statewide average per-patient claims (48.56% weight), adjusted by:
Case Mix Index
Wage Index Factor
Patients under age 18 are not subject to the spending limits and are excluded from all calculations

6. Case Mix Calculated Using Medicaid Grouper Developed in Consultation with the Work Group
The Grouper uses data from the Federal Outcome and Assessment Information Set (OASIS)
Assessment Reason
Start of Care
Recertification of Care
2 Groups
Clinical Factors
Diabetes
Orthopedic diagnoses
Dementia diagnoses
HIV diagnoses
Bowel Incontinence
Urinary Incontinence
Shortness of Breath
3 Groups Scored: Low, Moderate, High Intensity (A,B,C)
Functional Factors
ADL Dressing upper body
ADL Dressing lower body
ADL Toileting
ADL Transferring
3 Groups Scored: Low, Moderate, High Intensity (E,F,G)
Age
Less than 60
60-69
70-74
75-79
80-84
85+
6 Groups
108 Case Mix Groups =
(2 Assessment Reasons * 3 Clinical Groups * 3 Functional Groups * 6 Age Groups)

7. Calculation of Case Mix Index
A relative weight is assigned to the 108 resource groups (based on relative resources – 2009 Medicaid paid claims)
Low-utilization cases ($500 or less in a 60-day episode of care) are excluded from the calculation
An outlier threshold is assigned to each group
Outlier levels range from the 70th percentile for low-acuity patients to the 90th percentile for high-acuity patients
Costs which exceed the outlier thresholds are excluded from the Case Mix calculation
Each provider’s average Case Mix Index is based on the average for all 60-day episodes in the base year

8. Calculation of Wage Index Factors
Index uses 10 “Labor Market Regions” defined by the NYS Department of Labor
Average wages are extracted from the Occupational Employment Statistics (Federal Bureau of Labor Statistics) for 5 occupational categories:
Home Health Aides, Registered Nurses, Occupational Therapists, Physical Therapists, Speech Therapists
Occupational categories are weighted by each Region’s Medicaid utilization (as reported in the CHHA certified cost reports)
The Wage Index Factor is applied to 77% of the total reimbursement rate
Equals the percentage used in Medicare HHA reimbursement to measure the average portion of agency costs which are labor-related

9. Example Wage Index Factor Calculation Capital Region
Registered Nurses
Physical Therapy
Speech Therapy
Occupational Therapy
Home Health Aides
Regional Average Wage
$28.88
$31.82
$28.87
$30.62
$12.71
Statewide Average Wage
$35.31
$36.35
$36.07
$32.91
$11.44
Ratio (Region/Statewide)
.8181
.8754
.8003
.9305
1.1114
Weighting *
.6512
.1237
.0191
.0539
.1522
Total weighted ratio**
Adjusted for revenue neutrality (Average Spending Limits only)
** (.8181 X .6512*) + (.8754 x .1237*) + (.8003 x .0191*) + (.9305 x .0539*) + ( x .1522*) = .8755
Weighting is based on Medicaid visits reported by 10 CHHAs in Capital Region (2009 cost reports): Nursing: 39,899
PT: 7,577
Speech: 1,171
OT: 3,301
HHA: 9,326

10. Example of Calculation of Aggregate Average Per-Patient Spending Limits Example: NYC Provider X
Calculating the Allowable Average for Provider X – 2009 Claims
Provider X: Average Per Patient 2009 Claims * 51.44% Weight
$30,000 * = $15,432
Statewide Average: $17,013 * NYC Wage Factor = $16,967 * Provider X Case Mix (1.20) * 48.56% Weight
$16,967 *1.2 * = $9,887
Provider X: Total Weighted Allowable Average
$25,319
Calculating the Percentage Adjustment for Provider X
Provider X Average
$30,000
Provider X Allowable Average
$25,319
Amount Over Allowable Average
$4,681
$4,681 divided by $30,000 =
15.60 %
Provider X Payments Reduced Effective April 1, 2011 by

11. Implementation of CHHA Spending Limits
April 11, 2011 Dear Administrator Letter advised each provider of their aggregate annual per patient spending limits, and if applicable, the percentage reduction in their Medicaid payments
Providers with 2009 average per patient spending which is not in excess of their aggregate average per patient spending limit will have no initial reduction applied to their Medicaid payments
Providers with 2009 average per patient spending which is in excess of their aggregate per patient spending limit will have their Medicaid payments reduced by the percent of the excess

12. Implementation of CHHA Spending Limits
The advance information provided in the DAL is intended to allow providers to immediately begin to manage utilization levels
Upon the receipt of CMS approval, the applicable initial payment reductions will be applied:
Retroactively – to claims with service dates from April 1, which were paid prior to the implementation date
This retroactive application of the spending limits will result in recoupments which must be completed by end of FY 2011/12
Prospectively – to claims paid after the implementation date with service dates from April 1, 2011 through March 31, 2012
The Department has been working with CMS to respond to inquires and advance approval of the SPA as expeditiously as possible

13. Implementation of CHHA Spending Limits
The Department will review actual processed claims data from April 1, 2011 through the date of SPA approval
At the request of the industry, the Department is considering adjusting initial payment reductions from the percentages in the DAL to reflect reductions in utilization to date
Critical to successful implementation, the Department will periodically distribute information to providers to assess their per patient spending limits throughout the year
Information may be used to further adjust payment reductions

14. Implementation of CHHA Spending Limits
Initial payment reductions will be subject to final reconciliation
Final reconciliation will occur when substantially all the prior year claims (April 1, 2011 through March 31, 2012) have been processed - 6 to 9 months after March 31, 2012
The final reconciliation will:
Apply to ALL CHHA providers, including providers who were not subject to an initial payment reduction
Make an adjustment for actual case mix

15. Example of FINAL Reconciliation of
Average Per-Patient Spending Limits NYC Provider X
Reconcile in 2012:
Provider X Case Mix increases from 1.20 (2009) to 1.23 ( ) or by 2.5 %
Increase 2009 Provider Average Claim by Percentage Increase in Provider X Case Mix from 2009 to
$30,000 * 1.025*.5144 = $15,818
Statewide Average: Wage Adjusted, Provider X Case Mix Adjusted (1.23) * 48.56% Weight
$16,967 *1.23* = $10,134
Provider X: Cap Adjusted for Case Mix
$25,952
500 Patients in * Adjusted Cap = Maximum Provider Payments
$12,976,000
Actual Claims Paid
$12,900,000
Amount Due to Provider Upon Reconciliation
$76,000

16. CHHA Episodic Pricing: Overview
Effective April 1, 2012, reimbursement will be based on 60-day episodes of care (similar to Medicare model)
Episodic pricing will not apply to:
Low utilization patients ($500 or less)
Patients under age 18
These patients will continue to be subject to fee-for-service rates
Patients with Long Term Care needs (more than 2 episodes of care) will transition to MLTC
A Statewide Base Price (based on average 2009 Medicaid paid claims for 60 day episodes of care) will be calculated by reducing claims by:
Low utilization costs
High utilization costs which exceed sliding outlier thresholds
Outlier threshold range from the 70th percentile (for low-acuity patients) to the 90th percentile (high-acuity patients)
Base Prices will be adjusted to continue to achieve prior year savings
The Statewide Base Price will be adjusted by the same elements reflected in the Provider Spending Limits
OASIS Medicaid Grouper (108 Groups)
Wage Index Factor (10 Regions)
High utilization cases will be paid the Base Price, plus a percentage of the costs that exceed the outlier threshold

17. Total Cost of visits/hours
CHHA Episodic Reimbursement: Example New York City CHHA, Recertification Assessment, Clinical B (Moderate), Functional F (Moderate), Age Group (Case Mix Group 1-B-F-3)
Base Price
$5,600
(est’d)
NYC WIF*
Case Mix**
Total Episodic Price: $5,233
Calculation of Total Reimbursement to CHHA under 3 Cost Scenarios
Total Cost of visits/hours
Outlier Threshold
Episodic Payment
Outlier
Total
Payment
$3,000
$9,720
$5,233 $0
$6,000
$11,000
$640
$5,873
* Applied to 77% of Base Price
** Applied to 100% of Base Price

18. Implementation of CHHA Episodic Pricing
Requires CMS approval
Modifications to claims system in progress
Testing is projected to begin in January 2012
The Department plans to meet with a small technical advisory group to begin to discuss testing and dissemination of Medicaid Grouper

19. Other Reimbursement Actions (Effective April 1, 2011)
Affected Provider Groups
MRT #37 - Eliminate Case Mix Adjustment for AIDS – Standard Nursing Rate will be applied to AIDS Nursing Rate Codes (SPA 11-53)
CHHA
LTTHCP
MRT #4 - Eliminate 2011 Trend Factor
(Trend Factor Adjustment for January, February and March of 2011 will be applied) (SPA 11-66)
Personal Care
2% Across the Board Reductions
(Industry Preference) (SPA 11-72)
Increase in Non-Reimbursable Assessments from .35% to 1.05%
(In Lieu of Across the Board Reduction Per Industry Preference)
Recruitment, Training and Retention funding continued through 3/31/2014 ($100 million allocated across affected groups) (SPA 11-15)
CHHA, LTTHCP, AIDS Home Care, Hospice, MLTC

20. Health Homes

21. General Information
Section 2703 of the Patient Protection and Affordable Care Act (ACA)
Provides states, under the state plan option or through a waiver, the authority to implement health homes.
Provides the opportunity to address and receive additional federal support for the enhanced integration and coordination of primary, acute, behavioral health (mental health and substance use), and long-term services and supports for persons with chronic illness.
Provides 90 percent FMAP rate for health home services for the first eight fiscal quarters that a health home state plan amendment is in effect.

22. New York State Context Medicaid Redesign compels action
$33 million in projected savings from health homes implementation over
Strong building blocks exist from current initiatives
Managed Care
Chronic Illness Demonstration Projects (DOH)
MATS (OASAS)
Targeted Case Management (OMH, HIV/AIDS, etc.)
Launching pad for delivery system transformation
Opportunity for states to leverage availability of significant federal dollars to improve care and reduce avoidable costs
Evolve from care management as “band-aids” to a system purpose-built for integrated care

23. 975,000 Patients with Multiple Chronic Illnesses
State of Medicaid Spending:
High Cost Enrollees
975,000 Patients with Multiple Chronic Illnesses
I/Developmental Disability
Long Term Care
- 50K Recipients
$6.4B/$10,500 PMPM
- 200K Recipients
- $10.5B/$4,500 PMPM
Issues: High Cost; Lack of Management; High Intensity LTC and IP Services without coordination
Issues: Very High Cost - Waiver and FFS Expense is Growing Rapidly
Behavioral Health
Chronic Medical
400K Recipients
$6.3B/$1,400 PMPM
-300K Recipients
- $2.4B/$695 PMPM
Issues: High Cost; Socially Unstable, Lack of Services Management; Lack of BH and Physical Health Care Coordination
Issues: High Cost; Lack of Services Management; Lack of Physical Care Coordination

24. Health Homes: Key Considerations
Recipients
Can target by condition, severity, geography but not age
Cannot exclude dual-eligibles
Enhanced federal match for states
90/10 for health home services only, for first 8 quarters
Multiple SPAs permitted; 8 quarters are “rolling”
Quality measures
Required by CMS, established by state; provider reporting required for reimbursement

25. Federal Standards for Providers
Provide quality-driven, cost-effective, culturally appropriate, person- /family-centered services;
Coordinate/provide access to: high-quality, evidence-based services; preventive/health promotion services; MH/SA services; comprehensive care management/ coordination/ transitional care across settings; disease management; individual/family supports; LTC supports and services;
Develop a person-centered care plan that coordinates/ integrates clinical/non-clinical health care needs/services;
Link services with HIT, communicate across team, individual and family caregivers, and provide feedback to practices as feasible; and
Establish a continuous QI program.

26. New York’s General Qualifications
Must be enrolled (or be eligible for enrollment) in the NYS Medicaid program and agree to comply with all Medicaid program requirements.
Can either directly provide, or subcontract for the provision of, health home services. Responsible for all health home program requirements, including services performed by the subcontractor.
Care coordination and integration of heath care services will be provided to all health home enrollees by an interdisciplinary team of providers, where each individual’s care is under the direction of a dedicated care manager who is accountable for assuring access to medical and behavioral health care services and community social supports as defined in the enrollee care plan.
Must meet standards for delivery of six core health home services as described in following slides. Must provide written documentation that clearly demonstrates how the requirements are being met.

27. 1. Comprehensive Care Management
Policies and procedures to create, document, execute and update an individualized, patient centered plan of care for each individual that: a. Is informed by a comprehensive health assessment to identify medical, mental health, chemical dependency and social service needs. b. Integrates medical, behavioral, rehabilitative care and social service needs and clearly identifies the primary care physician/nurse practitioner, specialist(s), behavioral health care provider(s), care manager and other providers directly involved in the individual’s care. c. Identifies primary, specialty, behavioral health and community networks and supports that address their needs. d. Is developed and executed with the individual playing a central and active role. e. Has its goals, interventions and timeframes agreed upon by the individual. f. Identifies family members and other supports involved in the patient’s care, and includes them in the plan and execution of care as requested by the individual. g. Identifies goals and timeframes for improving the patient’s health care status and the interventions that will produce this effect. h. Includes periodic reassessment of individual needs and clearly identifies progress in meeting goals and changes in the plan of care based on changes in patient’s need.

28. 2. Care Coordination & Health Promotion
a. Accountable for coordinating, arranging for the provision of services, monitoring patient status and services, and evaluating patient outcomes, including prevention, wellness, medical, specialist and behavioral health treatment, care transitions, and social and community services where appropriate through the creation of an individual plan of care. b. Assigns each individual a health home care manager responsible for overall management of the patient’s care plan and clearly identified in the patient record. Each health home enrollee can have only one care manager. The individual cannot be enrolled in any other care management program. c. Has policies, procedures and accountabilities (contractual agreements) to support effective collaborations among primary care, specialist and behavioral health providers, evidence-based referrals and follow-up and consultations that clearly define roles and responsibilities. d. Supports continuity of care and health promotion through development of a treatment relationship with the individual and the interdisciplinary team of providers. e. Has a system to track and share patient information and care needs across providers and to monitor patient outcomes and initiate changes in care, as necessary, to address patient need.

29. 3. Comprehensive Transitional Care
a. Has system to provide prompt notification of individuals’ admissions to an ER, inpatient, or residential/rehabilitation setting. b. Has policies and procedures in place with local practitioners, health facilities including ERs, hospitals, and residential/rehabilitation settings, providers and community-based services to help ensure coordinated, safe transitions in care for patients requiring transfers in the site of care. c. Facilitates interdisciplinary collaboration among all providers, the patient, family, care givers, and local supports. d. Has a systematic follow-up protocol in place and must provide a summary care record to facilitate transitional care. e. Hospitals have established procedures for referring eligible individuals seen in emergency rooms to designated providers

30. 4. Patient and Family Support
a. Plan of care includes patient and family or caregiver preferences, education and support for self-management and resources. b. Provider utilizes support groups and self-care programs to increase patients’ knowledge about their disease and improve compliance with prescribed treatment.

31. 5. Referral to Community and Support Services
a. Provider identifies available community resources and supplies appropriate referrals and follow-up.
b. Plan of care includes community and other social support services as well as healthcare services that respond to patient needs and preferences and contribute to achieving patient goals.

32. 6. Use of HIT to Link Services
Health home providers will make use of available HIT and accesses data through the regional health information organization to conduct processes as feasible, to comply with the initial standards. In order to be approved as health home provider, applicants must provide a plan to achieve the final standards within eighteen (18) months of program initiation.
Initial Standards a. Has structured information systems, policies, procedures and practices to create, document, execute, and update a plan of care for every patient. b. Has a systematic process to follow-up on tests, treatments, services, and referrals which is incorporated in the plan of care. c. Has a health record system which allows the patient’s health information and plan of care to be accessible to the interdisciplinary team of providers. d. Makes use of available HIT to conduct these processes as feasible.

33. 7. Quality Measures Reporting to State
a. Has capability to share information with other providers collected and report specific quality measures as required by NYS and CMS.

34. Next Steps
Develop payment methodology and identify quality metrics for health homes
Anticipate submission of initial SPA- end of June
Health Home application/attestation released this summer-strong applications will include hospitals, CBOs, and managed care plans
Implement Health Homes October 1, 2011

35. Other Budget Actions

36. Home Care Worker Parity MRT 61
Application:
Home care aides:
employed by CHHAs, LTHHCPs , all Managed Care Plans, and LHCSAs

37. Home Care Worker Parity MRT 61
Requirements for Providers:
Attestation by provider to comply with living wage requirements
LHCSA provider: Attest that they are meeting requirement
CHHA/LTHHCP provider: Obtain written certification from contractors or other third party on forms prepared by the DOH that verify compliance of terms of living wage on a quarterly basis
All must maintain records of compliance for at least 10 years

38. Home Care Worker Parity MRT 61
Applicable in : Nassau, Suffolk, Westchester and NYC
New York City
3/1/ /28/2013:
90% of the total compensation mandated by the living wage law of NYC
3/1/ /28/2014:
95% of the total compensation mandated by the living wage law of NYC
3/1/2014 and beyond the following applies:
no less than the prevailing rate of total compensation as of 1/1/2011 or the total compensation mandated by the living wage law, whichever is greater

39. Home Care Worker Parity MRT 61
Westchester, Suffolk, Nassau
3/1/ /28/2014:
90% of the total compensation mandated by the living wage
law of NYC
3/1/ /28/2015:
95% of the total compensation mandated by the living wage
3/1/ /28/2016:
100% of the total compensation mandated by the living wage
3/1/2016 and beyond: The lesser of the following will apply:
115% of the total compensation of NYC; or
The total compensation mandated by the living wage law of Nassau, Suffolk or Westchester counties depending on episode of care location.

40. Personal Care Reform MRT 4652
Objective: Implement improved management and utilization for high intensity users
Rationalize housekeeping benefit while maintaining support to keep people in the community
Provide care coordination of high need personal care services

41. Personal Care Reform MRT 4652
Rationalize Level I Housekeeping Services by creating maximum 8 hour weekly benefit (Statewide)
Level I Housekeeping in the Personal Care Services Program
Discrete nutritional and housekeeping tasks in the Consumer Directed Program
Local Social Services districts received GIS 6/3/11 with Notice of Decision letters to be used for impacted Medicaid recipients allowing for fair hearing and aide to continue notice

42. Personal Care Reform MRT 4652
Implement improved management and utilization for high intensity users in NYC
Partnership pilot with HRA and Health and Hospital Corporation to establish a coordinated care model for high users of hours of PCS.
Regulatory Changes will be made
Clarifying use of continuous care and live in care

43. Personal Care Reform MRT 4652
Increase use of assistive technology and improve assessment for all NYC PCS recipients
HRA and Home and Hospital Corporation will work in tandem to establish guidelines and policies for use of new and existing technologies to support health and safety in the community

44. Global State Spending Cap
The Budget set a Global State Medicaid (DOH) spending cap of $15.3 billion in and $15.9 billion in
The Global cap is consistent with the Governor’s goal to limit total Medicaid spending growth to no greater than the rate for the long-term medical component of CPI.
DOH and DOB will closely monitor and report on program spending on a monthly basis to determine if spending growth is expected to exceed the Global cap (April report available on DOH Website).
DOH and DOB will develop and implement a plan of actions in the event that program spending exceeds the Global cap.

45. Global State Spending Cap
APRIL SFY Statistics
Category of Service
Medicaid Spending (Thousands)
Estimated
Actual
Variance
Inpatient
$210,115
$206,290
($3,824)
Outpatient/Emergency Room
$36,985
$31,834
($5,151)
Clinic
$41,341
$42,107
$766
Nursing Homes
$263,728
$257,598
($6,130)
Other Long Term Care
$190,629
$190,751
$122
Medicaid Managed Care
$389,283
$350,805
($38,478)
Family Health Plus
$73,394
$73,613
$219
Non-Institutional/Other
$192,343
$215,153
$22,810
Cash Audits
($51,553) $0
$51,553
TOTAL
$1,346,264
$1,368,152
$21,888

46. Global Cap SFY 2011-12 Cumulative Medicaid State Spending

47. Medicaid Redesign Team Update
New York's MRT was created in January includes 27 voting members representing:
Healthcare Industry
Business and consumer groups
Members of the Legislature
State officers/employees with relevant expertise
Phase 1: Submitted 79 reform recommendations to Governor – 73 of these were included in the enacted budget
Phase 2: Develop multi-year quality improvement/care management plan; work on complex issues that were not addressed in Phase 1.
Recommendations to Governor by November 2011
Nine Work Groups will be established – co-chairs have been named for three:
Managed Long Term Care Implementation and Waiver Redesign
Behavioral Health Reform
Program Streamlining and State/Local Responsibilities
 Additional information available at the MRT Website:

48. Questions
Please address questions and inquiries about today’s Webinar to:
Please indicate one of the following in the Subject line of your
Reimbursement Issues
Health Homes
Other Home Care Questions